Monday, April 22, 2019

GBP vs. USD: Bigger picture supports long-term 1.4


Of course, the pair remains a mystery for traders in the short term and looking for a few points, which puts them at great risk while the larger picture gives us a more accurate view of the nature of the pair, which has fallen from the standard levels since the British referendum to exit the European Union, but the question remains: Of the pound's trading range or whether there is some exaggeration in the losses that are causing the young people to get rid of their hands in the sterling while investors still have an investment outlook and increase their holdings of the pound in anticipation of the rise Expected during the coming period


Considering that we were basically trading at levels below or less than 1.50 before the British referendum, we certainly remember that during the referendum and even after the official referendum was released, we did not see a crash of more than 1.28 but what we remember well is the unjustified Flash Crash until the moment Which fell in the pair within minutes to the levels of 1.14, a decline not only explained by one of the trading algorithms and the game did not understand one of the parties or parties decided to push the pound Sterling to decline sharply before repurchasing minutes after levels will not return to it again, These have happened before and I call it (A fat finger) when a bank justified the occurrence of large trades on one of the pairs, which put pressure on the markets and caused something similar to Flash Crash that one of his employees deliberately pressed a button placed a large deal size was not planned in advance, causing the case of Flash Crash That ... was not a good explanation nor convincing but no one had a different explanation at the time, and in the case of the Flash Crash of the pound sterling no one even offered a trivial explanation like that ... In short there was no explanation and we will not know the truth apparently

But soon the Sterling Pound recovered to move towards 1.4 levels in less than a year from its arrival to the lowest recorded trading price and we are trading down from that point of the peaks between December 2017 and March 2018 down towards the 1.23 levels by December 2018 to see some recovery with the beginning Towards the current levels

Therefore, if the sellers rely on a fall coming out of the European Union, they are in an uncertain bet (unless one intervenes to open the Flash Crash deals) and if the herd is moving towards selling now in a positive tone from the EU towards Britain and facilitating the postponement of exit with some brawlers Of the British opposition, we have to deal with it as we are facing a currency that is ill and does not die. All indications are that the pound is able to withstand the comfortable trading levels of the British economy. They are not interested in returning the pound to the 1.5 levels, which limits their competitiveness. They are not likely to behave in the manner of a happy Japan with a weak currency. This will cause the British a lot to do so 1.4 levels may be the closest to the expectation, especially as the US dollar is estimated by many periodicals more than its value so we have not seen the 102 levels on the index While we see the increase in the gold holdings that the Fed is currently targeting while we also see gold able to stay above the 1200 all the time despite the bubble indicators that attract investors to get rid of gold holdings in favor of trading risk indicators

Does that mean buying the pound is safe?
Let's assume that we are going to make a decision in this matter and clearly away from the traders of the scalper closest to the Russian roulette and roulette tables. We have (original) if we exclude the Flash Crash event, the lowest trading levels are 1.20 registered on 17 January 2017 and the highest levels of trading during the passage An unprecedented crisis is 1.43 recorded on 18 April 2018
This simply means that we have clear buying areas for the asset with excellent support areas if we look at the issue purely in terms of investment, and it also applies to the pound's trading against the Japanese yen, perhaps even more than expected profits against the US dollar

The funny thing is that we may see Flash Crash in the other direction, which could hit Australian retailers with heavy losses if adults decide to play their game again for purchase in the coming days.

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